How to Reduce Instagram Advertising Costs

Instagram is one of the most active social media platforms with more than 1 billion monthly active users. This huge number of audience active on this platform makes it a perfect place to advertise your products and services. Instagram is not just known to increase brand visibility and customer loyalty but it has also been a powerful tool to boost sales. Now that you know the importance of this platform in this age, you must be wondering how much does Instagram advertising costs and how can you get the most out of the budget?

In this blog we will cover everything about advertisements on Instagram but first we will take a look at how Instagram ads work?

How Instagram Ads Work

Meta is the parent company of both social media platforms– Facebook and Instagram and now it has also acquired Whatsapp. So if you are familiar with facebook advertising then you will find Instagram advertisement similar and thus easy. However there are some differences in the format and placements this is because Instagram relies more on photos and videos rather than text.

Now Instagram offers a varied range of content posting such as feed, story, reel etc. Based on this, various types of ads are available:

Feed Ads: It allows you to advertise on the main Instagram feed of your audience
Story Ads: This type of ads appear between users’ Stories.
Explore Ads: The explore ads appear when users browse in the explore tab.
Reels Ads: This is one of the most viable Instagram Ads types and as the name suggests it appears as Reel.

Here are the average cost as per different Ad Formats:

Ad Formats	Objectives	Average Cost
Photo	Affordability	₹5 – ₹30 per click
Video	Engagement	₹10 – ₹50 per click
Carousel	Showcasing products	₹10 – ₹40 per click
Stories	Impressions	₹10 – ₹50 per click

The perks of advertising on Instagram is that you can advertise without having an Instagram account. Please note that if you have an Instagram account then you will be able to access your audience and get more ideas about the content.

What Makes Instagram Advertising Worth the Price?

Though the cost of advertisement on Instagram may be bigger than Facebook ads in some cases, they have features that make ads on Instagram desirable. Here are some reasons why IG advertising is so effective:

1. Advanced Targeting

It uses the same highly reliable targeting data it borrowed from Facebook. This means you can target users by their age, gender, interest, behavior, location and much more. There are also options to target customers based on custom audiences, including email communication, website traffic and even people who have engaged with previous posts published in Instagram.

2. Higher Engagement Rates

Looking at the interaction rates, people interact with photos on Instagram more than posts on the Facebook social platform. Research reveals that the images shared on Instagram garner 23% of the engagement level as those posted on Facebook. Moreover, the Instagram platform brings more calls to action like, comment, and share, due to its strong visuals focus. When it comes to video ads, things will be even better here – the share of video ads is 38% more interactive.

3. Clickable Links

Compared to regular Instagram posts, advertising enables you to have a clickable link to your website or a landing page. It is especially beneficial if you’re promoting an online store or blog, for instance, you allow users to perform a call to action right after the ad.

4. Longer Video Ads

Although the usable time of the normal Instagram Stories is only 15 seconds, the Ad featured on Instagram Stories can last up to 120 seconds. It means that you can take more time for your brand, products or services, to give a more captivating presentation.

Average Instagram Advertising Cost

When allocating resource for your marketing campaigns it is therefore important to know the costs of advertising on instagram. The Instagram advertising cost depends on several factors, and below we shall look at the average cost of advertising on Instagram.

1. Cost Per Click (CPC)

Going by their ad costs, Instagram campaigns cost per click (CPC) falls between $0.40 and $0.70. This is the cost of each individual action that a user conducts regarding your ad, which goes beyond just clicks on the links, but also likes, comments and shares, among others.

If the ad has a destination URL, it can mean with a link to the site or to the landing page of the company, it costs $0.50 – 0.95 per CPC. Compared to Facebook CPC this may sound very costly but generally the high engagement level on Instagram is worth the expense.

2. Cost Per Engagement (CPE)

Clicks are still costly as compared to engagement such as likes, comments, shares etc. on Instagram. The CPE may fall between $0.01 to $0.05 making it less expensive for you to increase the visibility of your posts on Instagram and interact with your target market.

3. Cost Per thousand Impressions (CPM)

The third cost model is called Cost Per thousand Impressions (CPM). It holds that the cost for any campaign depends on the number of thousand impressions achieved.

Cost per thousand impressions commonly known as CPM is how much you are willing to spend when you get 1000 impressions on the advert. On Instagram, the CPM frequently fluctuates from $2.50 to $3.50 for effective advertising promotions. The essential CPM cost is normally cheaper than that of Facebook, but it tends to increase if your niche is saturated.

Factors That Influence Instagram Advertising Cost

There are several things that determine the cost of Instagram advertising. It will now be useful to discuss these components in detail in order to assist you with controlling your budget.

1. Campaign Objective

Instagram advertisements can be served with different ad objectives depending on the marketing objectives that are set in place like reach, website clicks, or website conversions. Broad objectives are generally less costly than specific ones designed towards the low end of the marketing funnel such as acquisition or conversion since the latter needs better audience targeting and refined campaigns.

2. Audience Size

The size of the audience you want to speak to is one of the most important determinants of ad costs. This is a plus for broader audiences, for the simple reason that they are cheaper to market since not everyone wants to sell to them. Specialised markets therefore tend to be more competitive – as seen from engaging more defined coverage of the consumers, for instance on the basis of age or geographic location or income levels – which can exert pressures about the costs. The other disadvantage of retargeting the smaller and more engaged audience is that the costs of ads increase; however, the outcomes are normally better.

3. Budget

The budget you set for your campaign also determines how much money you will spend in advertising on Instagram. In the next point, less budgets may raise your cost per action since the impressions may remain in the ‘Learning Phase’ when the application adapts your ads. If its your advertisements are good, Instagram will help you drive the costs lower in the future.

4. Click-Through Rate (CTR)

CTR is one of the factors that define the efficacy of your advertising approach. If your CTR rate is low Instagram may cost you more for impressions as the platform considers your ad irrelevant to your targeted audience. So, try aiming for a CTR of 2% so that you could at least bring the cost of the ads down somewhat.

How to Reduce Instagram Advertising Costs

Despite the fact that IG advertising can cost more than advertising on other platforms, here are the best ways that you can adopt to optimize your budget.

1. Choose Campaign Objective

It is notable that what could be considered as bottom-of-the-funnel objectives such as awareness or engagement should be used first to increase a brand’s reconnaissance among the target audience. If you’re specifically interested in sales, always make sure that the users you’re targeting are more qualified and closer to a purchase than others.

2. Use Automatic Placements

Automatic placements enable the choice of the platform where the advertisement of your post can be displayed; either on Facebook or on Instagram. This makes you more likely to be able to negotiate better prices when buying ad placements and can also serve to decrease the amount of competition in the more saturated areas of Instagram which will decrease prices.

3. Trying Out Different Audiences

A/B testing on a regular basis can help in reducing instagram advertising cost. Also it helps to determine how different visitor segments, creative placements, and headlines affect your campaign. This lets you view which ad variations are effective when targeted at your audience, for better interaction and click through rates. By meaning, Instagram will be pleased to offer you a lower price of adverts once you attract users with high levels of engagement.

4. Optimize Your Creatives

Creativity also determines Instagram advertising cost. Many companies use high quality pictures or videos that are appropriate and align well with the users. Moreover, video seems to attract higher engagement than any other form of content.

Conclusion

Instagram advertising offers a unique opportunity to connect with a visually-driven audience, but it comes at a price. By understanding the cost structures and using smart strategies, you can ensure that your campaigns are both effective and budget-friendly. Instagram advertising cost is a great way to budget and allocate the resources wisely.